Stock Market Elliott Wave Analysis Trend Forercast

Where elliott wave is concerned I like to keep things very simple which is why I don't adhere to the many tenants of elliott wave theory as for me, EW is just a another technical tool. Here's what my previous elliott wave interpretation which correctly expected a rally to Dow 27k into October 2018 that was virtually spot on.

The updated graph resolves into an earlier 5th wave peak, which given the subsequent drop to 21,700 implies it was a termination of a LARGER 5th wave pattern. Which illustrates that where elliott wave is concerned everything is always clear in hindsight! Which is why it's best to try and keep things as simple as possible else risks fitting the wave count to a pre-existing point of view.

Nevertheless the 'simple' EW pattern implies that we are in Wave 1 rally that should imminently correct to at least 24,500 that would mark Wave 2, ahead of a Wave 3 advance that 'should' take the Dow to new all time highs and so on.

Of course I could do what most EWT practitioners do and also give an alternative EW count that would imply the exact opposite, but I consider such exercises pointless, so I go with that which appears to be the most probable outcome and bin the rest.

So EWT is bullish for stocks for 2019 with a correction imminent to around 24,500 that would lay the grounds for a rally to new all time highs, probably to around the 28k mark.

Nadeem Walayat has over 30 years experience of trading derivatives, portfolio management and analysing the financial markets, including one of few who both anticipated and Beat the 1987 Crash. Nadeem's forward looking analysis focuses on UK inflation, economy, interest rates and housing market. He is the author of five ebook's in the The Inflation Mega-Trend and Stocks Stealth Bull Market series that can be downloaded for Free.

Nadeem is the Editor of The Market Oracle, a FREEDaily Financial Markets Analysis & Forecasting online publication that presents in-depth analysis from over 1000 experienced analysts on a range of views of the probable direction of the financial markets, thus enabling our readers to arrive at an informed opinion on future market direction. http://www.marketoracle.co.uk

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